Tamsett failed to file a financing statement or the executed agreement
with the appropriate government office. C&H subsequently paid off
the original debt, and S&D continued to extend new credit to C&H.
Two years later, when C&H owed S&D more than $17,000, S&D
learned that (1) C&H was insolvent, (2) the Mack truck had been
sold, and (3) Tamsett had failed to file the security agreement. Does
S&D have a security interest in the Mack truck? Is Tamsett liable to
S&D? S&D Petroleum Company, Inc. v. Tamsett, 144 A.D.2d 849,
534 N.Y.S.2d 800, Web 1988 N.Y.App. Div. Lexis 11258 (Supreme
Court of New York)
27.2 Priority of Security Agreements World Wide Tracers, Inc.
(World Wide), sold certain of its assets and properties, including
equipment, furniture, uniforms, accounts receivable, and contract
rights, to Metropolitan Protection, Inc. (Metropolitan). To secure
payment of the purchase price, Metropolitan executed a security
agreement and financing statement in favor of World Wide. The
agreement, which was filed with the Minnesota secretary of state,
stated that ―all of the property listed on Exhibit A (equipment,
furniture, and fixtures) together with any property of the debtor
acquired after‖ the agreement was executed was collateral.
One and one-half years later, State Bank (Bank) loaned money to
Metropolitan, which executed a security agreement and financing
statement in favor of Bank. Bank filed the financing statement with
the Minnesota secretary of state’s office one month later. The
financing statement contained the following language describing the
collateral: ―All accounts receivable and contract rights owned or
hereafter acquired. All equipment now owned and hereafter acquired,
including but not limited to, office furniture and uniforms.‖
When Metropolitan defaulted on its agreement with World Wide six
months later, World Wide brought suit, asserting its alleged security
agreement in Metropolitan’s accounts receivable. Bank filed a
counterclaim, asserting its perfected security interest in
Metropolitan’s accounts receivable. Who wins? World Wide Tracers,
Inc. v. Metropolitan